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When Are Appearances Deceiving? The Nature of the Beauty Premium

  • Deryugina, Tatyana

We design a laboratory experiment to illuminate the channels through which relatively more attractive individuals receive higher wages. Specifically, we are able to distinguish taste-based discrimination from rational statistical discrimination and biased beliefs. Using three realistic worker tasks to increase the external validity of our results, we find that the “beauty premium” is highly task-specific: while relatively more attractive workers receive higher wage bids in a bargaining task, there is no such premium in either an analytical task or a data entry task. The premium in the bargaining task is driven by biased beliefs about worker performance. We find that there is substantial learning after worker- specific performance information is revealed, highlighting the importance of accounting for longer-run interactions in studies of discrimination.

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File URL: http://mpra.ub.uni-muenchen.de/53581/1/MPRA_paper_53581.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 53581.

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Date of creation: Aug 2013
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Handle: RePEc:pra:mprapa:53581
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  1. Daniel S. Hamermesh & Jeff E. Biddle, 1993. "Beauty and the Labor Market," NBER Working Papers 4518, National Bureau of Economic Research, Inc.
  2. David J. Cooper & Hanming Fang, 2006. "Understanding Overbidding in Second Price Auctions: An Experimental Study," Cowles Foundation Discussion Papers 1557, Cowles Foundation for Research in Economics, Yale University.
  3. Mocan, Naci & Tekin, Erdal, 2006. "Ugly Criminals," IZA Discussion Papers 2048, Institute for the Study of Labor (IZA).
  4. Ayres, Ian & Siegelman, Peter, 1995. "Race and Gender Discrimination in Bargaining for a New Car," American Economic Review, American Economic Association, vol. 85(3), pages 304-21, June.
  5. Berri, David J. & Simmons, Rob & Van Gilder, Jennifer & O'Neill, Lisle, 2011. "What does it mean to find the face of the franchise? Physical attractiveness and the evaluation of athletic performance," Economics Letters, Elsevier, vol. 111(3), pages 200-202, June.
  6. James Andreoni & Ragan Petrie, 2005. "Beauty, Gender and Stereotypes: Evidence from Laboratory Experiments," Experimental Economics Center Working Paper Series 2006-22, Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University.
  7. Biddle, Jeff E & Hamermesh, Daniel S, 1998. "Beauty, Productivity, and Discrimination: Lawyers' Looks and Lucre," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 172-201, January.
  8. Mobius, Markus & Rosenblat, Tanya, 2010. "Why Beauty Matters," Staff General Research Papers 32112, Iowa State University, Department of Economics.
  9. Simon Gächter & Elke Renner, 2010. "The effects of (incentivized) belief elicitation in public goods experiments," Experimental Economics, Springer, vol. 13(3), pages 364-377, September.
  10. Castillo, Marco & Petrie, Ragan & Torero, Maximo & Vesterlund, Lise, 2013. "Gender differences in bargaining outcomes: A field experiment on discrimination," Journal of Public Economics, Elsevier, vol. 99(C), pages 35-48.
  11. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  12. Berggren, Niclas & Jordahl, Henrik & Poutvaara, Panu, 2010. "The looks of a winner: Beauty and electoral success," Munich Reprints in Economics 20267, University of Munich, Department of Economics.
  13. Mariana Blanco & Dirk Engelmann & Alexander Koch & Hans-Theo Normann, 2010. "Belief elicitation in experiments: is there a hedging problem?," Experimental Economics, Springer, vol. 13(4), pages 412-438, December.
  14. Jefferson Duarte & Stephan Siegel & Lance Young, 2012. "Trust and Credit: The Role of Appearance in Peer-to-peer Lending," Review of Financial Studies, Society for Financial Studies, vol. 25(8), pages 2455-2484.
  15. Rosenblat, Tanya, 2008. "The Beauty Premium: Physical Attractiveness and Gender in Dictator Games," Staff General Research Papers 13001, Iowa State University, Department of Economics.
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